War by Other Means

Recent Article by Gabriel Felbermayr in WIFO-Monatsberichte (monthly reports)
Countries have always used economic policy tools such as import duties, taxes, sanctions, or regulatory instruments to achieve geopolitical objectives, but the practice has become much more widespread with the re-emergence of international power rivalries. Countries such as Austria and political alliances such as the EU must embrace this new reality and sharpen their own geoeconomic instruments.

To do so, it is important to understand the economic mechanisms at play and to have the best possible information about domestic and foreign economic dependencies and vulnerabilities. The single most important instrument for European countries is the EU single market whose depth and dynamism offer defensive and offensive leverage in dealing with foreign powers. This article summarises the main findings of a large WIFO study that is meant to provide guidance to policy practitioners.

Finalization: February 2023
Specialist publication: WIFO-Monatsberichte